Any city with a ratio of greater than 5.1 was considered severely unaffordable.

This has prompted some to consider whether renting a property is their only option to get onto the property ladder.

What is Rentvesting?

Rentvesting is when an aspirational property owner purchases a property, within their budget, to rent out and then rents a property where they would prefer to live.

For example, let's imagine a young couple with two children wants to purchase a three-bedroom home close to the beach on the Gold Coast.

The sales prices in these suburbs means that unfortunately these properties are not affordable.

Rentvesting Solution

A rentvesting solution would be to rent a property in the area where the couple want to live, and purchase an affordable investment property in a suburb with good growth drivers.

The property the couple buys can then be rented out to help cover their own rental payments and later sold for a capital gain.

This has allowed many Australians to maintain the lifestyle they want to live now, whilst also building a property investment portfolio for the future.

With any financial decision, it’s important to discuss your financial profile with your financial institution or mortgage broker, so you get a complete understanding of how much you can afford to borrow and repay and get a finance solution for your individual circumstances and goals.